How I Budget

A lot of people often message me asking how I budget and if I use a certain layout/template.
So I thought I would share some details about how I manage our money.
I obviously have no professional experience in this, how I manage our finances is just something I have found that works for us..

One thing that really annoys me is when people say ‘you’re so lucky you can stay at home and don’t have to work full time’-especially when it always seems to be coming from those people who are shopaholics….
But really, I believe that anyone can do this, if they stick to a strict budget and don’t waste their money on unnecessary things.
During the months I wasn’t getting any income, we still paid all our bills, we still socialized, and we still saved.
It was a huge eye opener to how much money we were wasting beforehand!
People always seem to say ‘I need more money’-trust me, I say the same thing too.
But if you asked me how much more money I needed, I couldn’t tell you a sum.
Why?
Because there isn’t a set amount I need-really, we survive perfectly fine on the income we get now. I earn less then half the amount now then I was when working full time-and you know what the only difference is?
I’m happier!
Happier because I don’t have the stress of working full time hours and trying to manage a household, and I get to spend my days at home with my daughter.
Besides that nothing is different. I never feel like we go without, and I don’t stress about having enough money.

Where is all your money going?
The first, and most important thing you need to do is sit down and work out your expenses, I break everything down into weekly expenses.
I use excel, but it can easily be hand written or using word.
Write down everything, mortgage/rent, all bills, loans/debts, groceries, petrol, regos, insurances, spending money, absolutely everything!
Use your internet banking and statements as a guide to see where your money is going.
Some of my smaller bills such as a $30 annual bill I still budget for, even at $0.60 a week!
This can also be a huge eye opener for you to notice how much money you could be wasting on certain things such as eating out, take away coffees, clothing etc.
Below is a template I use on excel (all amounts are made up & this isn’t necessarily expenses I personally have, its just to give you a rough idea)

Categorize Your Spending
Now with the list in front of you, categorize into sections.
I have a:
Mortgage Account
Bills Account
Everyday Spending Account
Emergency Account
Gifts Account
Multiple Savings Accounts
I’ve also just opened up an account for Eadie thanks to @mama.alayna blog about having an account for her daughter
I’ll go into more detail about these below

Mortgage Account
I think this is pretty self explanatory-this is the account that our monthly mortgage comes out of, so each week we transfer the required amount into it.

Bills Account
This is possibly the best thing you can do to manage your money.
It wouldn’t bother me if I received a $700 bill tomorrow, because I’ve always got the money sitting there.
With working out all of our expenses into weekly sums, we transfer that amount each week into a Bills Account we have.
I have all our direct debits set up from this account, so besides the few that I don’t have direct debited, everything takes care of itself within the account, and the others I just pay myself from the account when needed.
Like I said above, even the smallest amounts of $0.60 cents per week for a bill will be budgeted for in here.

Everyday Spending Account
This is I guess what you would call our ‘splurge’ money.
We have worked out a small amount that we need each week as spending money-this covers our petrol, my exercise classes and just a small amount if say I want to go on a coffee date or have lunch with a friend.
I also put our grocery allowance into this account.

Savings Account
After we pay all our bills and mortgage, and allocate our spending money, whatever we have left we put towards our savings.
Daniel and I have a few different savings accounts set up, to save towards different things.
We have a personal savings each, to save towards personal things we want/need.
We also have a savings account for holidays, which we just add a small amount too until we have something planned/booked and then we will focus more on that.
I have just opened up a personal savings account for Eadie-I haven’t quite worked out how much I need to put in this just yet, as she doesn’t really have any expenses at this current moment. But I will still put some money into it which can go towards things such as swimming lessons, any activities she does, then later on kinder and school fees. I am also planning on putting some extra into this account so that if we ever want to do a family activity such as go to the Zoo, Aquarium etc. we can use money from here rather then stressing about if we can afford to take her.

Emergency Fund
This is something we ALWAYS use!
And always seem to be building back up, haha!
I like to have a minimum of $2000 for an emergency savings, to cover things like insurance excess, any car issues, vet bills, or any other unexpected things that pop up.
We also used this account to buy a cheap car off of a family member at the end of last year-an unexpected offer, but we were able to take advantage of it because of this money.
You need to be prepared for things to pop up unannounced, because otherwise this could be where you get in trouble, by taking money from other places or using credit cards/loans.
We aren’t always perfect with our money, there always seems to be something that has popped up that I wasn’t expecting or had budgeted for, but having an emergency fund helps us get through.

Gifts Account
Don’t you hate it when its a loved ones birthday, and all your thinking is ‘crap, I cant afford to get them a nice gift at the moment’ or that dreaded time at Christmas where you are broke every week leading up to it?
Well having a gifts account makes life so much easier for us!
I don’t have a set amount to spend on each family member for each occasion-I don’t believe you need to spend $100 on each person just because. If there’s nothing they need just get them something small and affordable as a nice gesture, and save your money-and then if the next time they want something that is $500, you can have the money there to put towards it, rather then stressing.
That’s how I see it anyway.
Daniel and I have had many occasions where we haven’t got one another a gift-but then there has also been times where we have gotten something expensive for one another.
I budget $50 a week to cover this, and I think that’s more then enough.
I also think of it as another savings account for things Daniel and I may want/need that we can purchase for ourselves.

I hope by sharing how I personally budget I might be able to help some others with managing their money.
If you have any questions about anything feel free to message me 🙂
Thanks for reading! xo